“I’ve been in the firm 33 years and this gives me
absolutely no pleasure whatsoever,” he told U.K. lawmakers in
London today. “You shouldn’t be under any illusion as to how
seriously we take this and how upsetting this whole thing has
been. We’ve crushed our reputation with the Mexican events.”

The settlement included a deferred prosecution agreement
with the U.S. Department of Justice. The U.K.’s Financial
Services Authority said the London-based bank will have to
employ an independent monitor to oversee compliance with anti-money laundering requirements.

HSBC’s Mexican branches had become so well-known to drug
traffickers as the place to launder proceeds from illicit sales
that cartels began using special boxes to speed transactions,
U.S. prosecutors have said.

“We bought a bank in Mexico, we bought cheaply because it
was in distress,” Gulliver, 53, told the Parliamentary
Commission on Banking Standards. “We ourselves were too slow to
put in place anti-money-laundering systems that were up to the
standards required today.”

Since being promoted to CEO of Europe’s largest bank by
assets in January 2011, Gulliver said he has improved the bank’s
country management structure, in place since the bank’s
foundation in 1865.

“I do not believe this bank is too big to manage,” he
said. “If you are large and complex, yes, I can appreciate the
challenge, but if you are large and reasonably straightforward I
believe you can manage these things.”

The lender’s chief risk officer, Marc Moses, will be the
fifth best-paid in the group, pending board approval, according
to Gulliver. In 2006, that role “wouldn’t have been in the top
50, so there is someone who’s clearly being rewarded for
stopping things,” he told lawmakers.